A Harvard Professor Made $400 Million in Moderna’s Biotech IPO

(Bloomberg) -- On the Sunday before Moderna Inc. launched one of the biggest initial public offerings in biotechnology history, one of its earliest investors was giving a lecture about rocks.

Timothy Springer, a professor of medicine at Harvard Medical School, is a collector of gongshi, or scholars’ rocks, from China. As Moderna executives prepared for the company’s much-anticipated stock-market debut, the unassuming academic spoke at the Boston Sculptors Gallery about his search for the fantastically shaped stones that have inspired poets and artists for centuries. 

“The way he’s interested in stones, it’s the same way he’s interested in his work,” said Kemin Hu, one of the world’s foremost experts on the stones. Springer is one of her students. “When he loves something, he wants to do something. For science you need this kind of spirit.”

Springer is the fourth-largest shareholder of Moderna, which hopes to make personalized cancer vaccines. He’s invested $5 million and now owns 17.3 million shares, which at the IPO price of $23 a share were valued at roughly $400 million. Even after Moderna stock sank by nearly 20 percent on their first day of trading, his stake was worth $320 million.

Moderna wasn’t Springer’s first windfall. He's become one of the wealthiest academics in the U.S., having made about $100 million when his first venture, a drugmaker called LeukoSite, was bought by Millennium Pharmaceuticals in 1999. Since then, he has become a prolific backer of young biotechnology companies.

Despite his expanding wealth, Springer retains the mien of the researcher. He wears jeans, bikes to work and socializes with other academics. He spends more time with fleece-clad scientists than Ferragamo-shod bankers.

“I have an academic lifestyle,” Springer said in an interview. “I’m not into ramen noodles, but my friends are academics, so it doesn’t really behoove me to be flashy.” 

His few indulgences include a modernist home in Boston's upscale Chestnut Hill neighborhood, where Springer, 70, devotes his surplus energy to keeping a prolific garden. 

“We don’t have a second home,” he said. “If we go away in the summer, we can’t harvest the vegetables.”

Springer came to invest in Moderna by happenstance. In 2010, his Harvard colleague Derrick Rossi asked for advice on getting venture capitalists interested in his idea to use messenger RNA to transform stem cells for the treatment of disease. Rossi was having trouble finding funding and knew of Springer's success with LeukoSite.

“They trotted it out to a few venture capitalists and no one wanted it,” Springer said. “He was my faculty colleague and so he came to me and I liked it and I put some money into it. I said if you like I can introduce you to some other people.”

Those people included celebrated Massachusetts Institute of Technology chemical-engineering professor Robert Langer and Flagship Pioneering, a Cambridge, Massachusetts, firm that incubates and launches life-science companies. Moderna was born.

Springer’s investment in Moderna also launched him as a notable backer of medical startups. He's put his own money into companies such as Editas Medicine Inc., Selecta Biosciences Inc. and Morphic Therapeutics, which he helped found.

Another of Springer's ventures called Scholar Rock Holding Co. -- a nod to his passion for the ornately shaped stones -- went public this year amid a wider surge in biotech IPOs. Since their May debut, the shares have risen more than 90 percent.

From December 2008 through this November, Springer estimates that his internal rate of return is about 57 percent. He often serves on the boards or scientific advisory committees of companies he’s backed.

Springer said investing is “a way of achieving things. There’s certain metrics you can achieve in academia, you can win prizes, you can have lots of citations to your publications. There's very clear metrics in investing.”

“Making money is something that people desire to do and it's not easy to do,” he said.

His accumulating gains have allowed Springer to pursue larger goals. With $25 million of his own money, he founded a nonprofit called the Institute for Protein Innovation devoted to finding more effective antibodies. Past research in that area has helped to find blockbuster medications including AbbVie Inc.'s Humira, the best-selling drug in the world. 

Springer says he will give away some of the institute's discoveries for free. Part of its mission is to develop an open-source library of known antibodies, building a kind of protein recipe book to help researchers conduct basic science that drug companies, which are focused on more near-term horizons, won't bankroll.

“I feel that I’ve had more than enough wealth for myself for some time," Springer said. "I don’t feel I need more.”

To contact the editor responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Timothy AnnettMark Schoifet

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